Kickstarting supply in a labor marketplace
Kickstarting supply in a labor marketplaceGrowth lessons from over a dozen of today's fastest-growing labor marketplaces👋 Hello, I’m Lenny, and welcome to this month’s ✨ free edition ✨ of my newsletter. Each week I humbly tackle reader questions about product, growth, working with humans, and anything else that’s stressing you out at the office. Here’s what you missed this month if you aren’t a subscriber: Subscribers also get access to a private Slack community, fireside chats with folks like Teresa Torres, the full archive of past posts, hundreds of discounts on all kinds of software (including 20% off posts to my job board), and much more.
I’ve spent a lot of time thinking about marketplaces, but I’ve never dug deeply into labor marketplaces specifically. What makes labor marketplaces interesting is that instead of connecting people to a product (e.g. Airbnb and homes, DoorDash and food, Etsy and crafts), they connect people to people. How cool! For example, The Mom Project connects mothers who are returning to the workforce with flexible job opportunities. Roo connects on-demand veterinarians with understaffed veterinary hospitals. Instawork connects small businesses with vetted hourly workers. Many of these marketplaces are all exploding right now as people reenter the workforce post-pandemic. Labor marketplaces are generally heavily supply-constrained—meaning their growth is bottlenecked by their lack of supply—so it’s crucial that founders of labor marketplaces nail their supply growth strategy. To answer your question, I researched about a dozen of today’s most successful and fastest-growing labor marketplaces and found there are essentially four primary ways to drive your supply in the early days: Below are first-hand stories and tactics from the founders and early team members behind these amazing companies (plus a bunch of great one-off ideas that anyone may find helpful). Enjoy! Huge thank-you to Allison Esposito Medina, Allison Robinson, Dave Lu, Eric Vishria, Iman Abuzeid, Jaime Getto, Lisa Hu, Mike Slagh, Peter Faist, Romeen Sheth, Ryan Mapes, Sander Daniels, Sarah Holmes, Sumir Meghani, and Wei Deng for sharing your insights with me. How to kickstarting supply in a labor marketplace1. Job boardsNo question, the single most popular channel for early supply growth in a labor marketplace, particularly for companies that focus on one type of role (e.g. nurses), is posting a generic role to an existing job board like Indeed, ZipRecruiter, or Craigslist. For example:
Advice: Figure out if (and where) your potential supply looks for work, and go post roles there. 2. Targeted outreachWhether it was cold outreach to strangers or reconnecting with former colleagues, the second most common growth channel for these marketplaces was reaching out to potential “supply” and convincing them to join:
Advice: Do things that don’t scale—go direct to your potential supply and convince them to try your platform. 3. Word of mouth + paid referralsThe third most common growth channel, and one that’s hard to engineer if your product doesn’t yet have strong product-market fit, is word of mouth, often with a referral program layered on top:
As Lisa noted above, B2B marketplaces often have the benefit of their supply (e.g. nurses, restaurant workers, plumbers) hanging out and sharing what’s working for them—an excellent breeding ground for word of mouth. If you have this, well done. If not, life will be tougher. Advice: Build something so great that your “supply” can’t help but tell their friends about it. 4. Paid socialThe final commonly-used growth channel turned out to be paid ads on social networks, particularly LinkedIn:
Advice: Experiment with running ads on LinkedIn. Beyond these four common tactics, founders also shared a bunch of great one-off ideas that worked well in their particular market. Additional tactics that worked for at least one labor marketplace:1. Upskill your supply
2. First build a community
3. Make certain there is demand
4. Get press
5. Do manual onboarding
6. Concentrate on a geo
7. Get the messaging right
Have any questions, comments, or other ideas? Leave a comment! Have a fulfilling and productive week 🙏 🔥 Featured job opportunities
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